In the wake of the massive global emissions scandal Volkswagen has admitted it is exploring options for growth in its heavy-truck division that could include acquisitions and an initial public offering (IPO).

VW global trucks boss Andreas Renschler said in an interview published by Bloomberg that the U.S. and China, are among key areas for possible expansion.

The USA is the only major market where VW heavy trucks have no significant presence, The strategy could see VW challenge global industry leaders Daimler and Volvo as well as smaller rivals in emerging markets.

Renschler admitted that as trucks require quite different specifications in individual regions, any expansion in the U.S. would probably involve an acquisition.

The VW trucks boss declined to comment on specific plans or targets.

“We’re keeping all options open on our way to becoming a global trucks leader,” Renschler said in the interview in Munich.

“We want to be industry leaders in terms of profitability, customer-oriented innovations and global presence, not necessarily in terms of sales volume.”

With VW dealing with the fall out from its car emissions scandal and a possible dip in revenue and profit as well as potential massive outgoings, the highly profitable VW owned heavy vehicle subsidiaries including Scania and MAN are providing desirable cash inflow for the giant German auto maker.

Unlike its passenger-car siblings, Volkswagen’s truck units aren’t dealing with fallout from the diesel-emissions scandal.

The crisis besetting the parent company triggered a management revamp and accelerated a push started a year ago to give its 12 brands more leeway to make their own choices, handing Renschler, who previously held the same post at Daimler, more room to maneuver.

Some industry analysts in Europe have pointed toshareholders welcoming an IPO for VW’s trucks business which would allow the company to start lifting value after decades of ‘empire building’.

One analyst estimated the combined value of VW’s truck assets at about 20 billion euros ($AUD31.8 billion).

VW has lost almost 22 billion euros ($AUD 35 billion) in market value since the emissions cheating became public on 18th September.

North America remains the largest undeveloped territory for the Volkswagen truck operation. The company formed its heavy truck unit in 2015 in a bid to better coordinate MAN, Scania and its VW truck and bus brand.

By contrast, both Daimler and Volvo enjoy large North American market shares with Freightliner and Mack nameplates.

Still sales in that market are entering a lull and Volvo recently revised its outlook and predicted that truck industry deliveries in North America will shrink seven per cent this year.

“In the long-term, the North American market is of course interesting for us but it has to be a good fit for us as well as for a possible partner,” Renschler said.

He declined to comment on whether Volkswagen would be interested in buying Paccar or Navistar International, the truckmaker partially owned by billionaire Carl Icahn.

In China, the world’s biggest market for heavy-duty trucks, the likelihood of a flat market this year hasn’t deterred Volkswagen from growth plans.

“We’re pursuing a dual-track strategy in China,” Renschler said. Volkswagen is seeking to expand with partner Sinotruk Hong Kong Ltd. in the mass-market segment as well as boosting the higher-end business of selling its own MAN and Scania vehicles.

Volkswagen is also in talks about joint projects with other companies including FAW Group’s commercial vehicle arm. The negotiations with FAW are separate from expansion discussions for a car joint venture the two companies also operate.

Renschler joined VW a few months before the truck unit was created. The hiring of one of the industry’s most high-profile executives from a key rival underscores the sense of urgency at Volkswagen. It is clearly wanting to reap more financial benefits from its multi-billion-euro takeovers of both MAN and Scania.

That means intensifying cooperation between MAN and the smaller, higher-margin highly profitable Scania unit.

MAN has weathered a downturn in South America which has eaten away at profits and seen a restructuring program commence. Scania on the other hand has been more resilient to swings in the cyclical truck industry.

MAN is cutting about 1,400 administrative and 400 production jobs as part of a revamp program to lower costs which will be completed next year.

Cooperation will focus on joint procurement, research, business development, finance and personnel.

Whether that means Scania and MAN will grow closer in Australia is yet to be seen. Certainly when Transport 7 Trucking quizzed Scania Australia boss Roger McCarthy late last year about the possibility of some sort of local co-operation between the two VW truckbrands it was dismissed out of hand.

Forging an efficient alliance will play out principally in western Europe where Scania and MAN have a combined market share of about 30 percent.

Cooperation had been hampered in the past by memories of MAN’s ill-fated 2006 attempt at a hostile takeover of Scania.

Volkswagen opposed the attack then took control of both companies, buying out Scania’s minority shareholders in 2014.

Overcoming cultural differences and ensuring collaboration will be crucial for the strategy to pay off. They’ll also need to weather some gloom with Renschler predicting that Brazil, a key South American market, won’t turn around before 2018.

“You don’t change corporate culture by sitting down and holding each other’s hands,” Renschler said. “You need to get people to really work together to achieve common results.”